Agreement encompasses a broad IP estate and library of anti-cancer compoundsengineered for improved efficacy and tolerability

FLAG Therapeutics Inc. and Duquesne University today announced an exclusive worldwide licensing agreement for two novel classes of small molecule, water-soluble drugs designed to target and destroy cancer cells: anti- angiogenic/anti-tubulin (AA/AT) compounds and folate-targeted anti-cancer (FTAC) compounds. The agreement represents one of the largest licensing ventures in Duquesne's history and encompasses the career portfolio of renowned cancer researcher and Duquesne professor Dr. Aleem Gangjee. A vast library of compounds and an intellectual property portfolio protected by over 50 US and international patents and patent applications are included in the deal.

The AA/AT compounds included in the agreement are the first compounds ever to combine the dual-action of the two major classes of anti-cancer drugs into a single molecule. An emerging understanding of tumor vasculature highlights the importance of simultaneously attacking tumors with both drugs, but current treatment combination regimens often miss the window of opportunity due to different dosing schedules and pharmacokinetics. FLAG Therapeutics' dual acting AA/AT compounds deliver a simultaneous anti-angiogenic and anti-tubulin assault on the tumor. By attacking the tumor when it is most vulnerable, FLAG hopes to increase drug efficacy while decreasing the potency of the anti-tubulin activity for improved tolerability. In addition, FLAG's AA/AT compounds are designed to circumvent the two major mechanisms of drug resistance (P- glycoprotein (PGP) and β-III tubulin overexpression) that limit the utility of current therapies.

The second class of drugs, FTAC compounds, is designed to selectively bind to sites found almost exclusively on certain cancer cells and interrupt cell multiplication. Traditional anti-cancer drugs indiscriminately kill cells as they divide, the result being that while rapidly dividing cancer cells bear the brunt of the toxic activity, fast dividing normal cells (blood cells, mucosal linings and hair follicles) incur collateral damage. FLAG's FTAC compounds are engineered to specifically and selectively bind to targeted cancer cells to avoid harming healthy cells.

Frank Sorgi, Ph.D., president and chief executive officer of FLAG Therapeutics, stated, "I am pleased to partner with Duquesne University to further develop AA/AT and FTAC compounds. Dr. Gangjee is a highly respected researcher, and FLAG is honored to be in the position to advance his discoveries from the bench, into the clinic, and ultimately to individuals in need of new cancer therapeutic treatment options." Dr. Sorgi continued, "We already have identified lead clinical candidates, each supported with encouraging comparative in vivo data versus current therapies, and we look forward to rapidly advancing these compounds into clinical trials."

Dr. Alan Seadler, associate provost for research and technology at Duquesne, commented, "We feel this licensing agreement provides the best possible strategy to develop the discoveries of Dr. Gangjee and hopefully provide life-saving drugs to people battling cancer. We are particularly pleased to be working with FLAG Therapeutics to reach this goal."

About FLAG Therapeutics Inc.

FLAG Therapeutics Inc., headquartered in Raleigh, North Carolina, is an early-stage oncology company focused on the development of therapies based on two novel classes of small molecule, water-soluble drugs. In vivo studies suggest that both classes of compounds, anti- angiogenic/anti-tubulin (AA/AT) compounds and folate-targeted anti-cancer (FTAC) compounds, hold the potential to treat multiple cancer types with greater safety and efficacy than conventional therapies. FLAG Therapeutics has obtained exclusive worldwide rights to these compounds from Duquesne University. To learn more about FLAG Therapeutics, please visit www.flagtherapeutics.com. Information on FLAG Therapeutics' website is not incorporated by reference into this press release.

Duquesne University

Founded in 1878, Duquesne is consistently ranked among the nation's top Catholic research universities for its award-winning faculty and tradition of academic excellence. The University is nationally ranked by U.S. News and World Report and the Princeton Review for its rich academic programs in nine schools of study for nearly 10,000 graduate and undergraduate students, and by the Washington Monthly for service and contributing to students' social mobility. Duquesne is a member of the U.S. President's Higher Education Community Service Honor Roll with Distinction for its contributions to Pittsburgh and communities around the globe. The U.S. Environmental Protection Agency and the Princeton Review's Guide to Green Colleges acknowledge Duquesne's commitment to sustainability.